Hemp Prices Hold Mostly Steady As Year End Approaches; Added Volatility Seen In 2022

November Hemp report/Carbon capuring buildings/SOM
Suzanne Cosgrove

Suzanne Cosgrove

Editor

— Hempcrete finds a new role in as a carbon reduction agent

As the books close on the fall harvest, most midpoint hemp prices remain steady to marginally higher, according to the November 2021 PanXchange Hemp: Benchmark & Analysis report.

The exchange noted growing expectations for industry consolidation and acreage reductions in 2022 gained a foothold during the harvest season. Reports of acreage and production cuts are unverified, but some analysts predict Colorado’s harvest may total just 3,000 acres, compared with the Farm Service Agency’s estimate of 6,000 acres planted and PanXchange’s calculation of 2,375 acres. 

If reports of acreage cutbacks are correct, industry participants can expect more volatility in the new-crop markets, the exchange said.

In the meantime, new-crop biomass “is its own market” right now, the report said, with limited volume available on the spot market. Growers this year generally planted for their own production needs or for the amount they had contracted. 

On the flip side, well-preserved old-crop inventories are still available and capping biomass prices, the analysis shows. One caveat: those older, less-expensive supplies are becoming more difficult to source amid freight delays, even as an estimated 15 to 40 million pounds of viable 2019 and 2020 biomass material is still available.

Meanwhile, processors have taken advantage of cheap biomass prices to process the material into winterized crude. Demand for high-quality crude persists, but oversupply and lower prices are expected to continue until 2019 and 2020 biomass inventories evaporate.

Zeroing in on the industrial hemp sector, PanXchange said micronized hurd, which is used in bioplastics, plaster and a number of other applications, is trading steadily. “Micronized hurd is still very much in R&D, but is not far from developing a leading market,” the exchange said. Hemp grain is also expected to find support from the growth of food-quality material.

Hempcrete in a sweet spot

A very different bit of hemp-related news worth following in the future was a November presentation by the design and architectural megafirm Skidmore, Owings & Merrill at the 2021 United Nations Climate Change Conference, or COP26, in Glasgow.

The design firm announced a plan called Urban Sequoia, which proposes building an environment that can absorb carbon. SOM said its proposal was a viable one, and it could transform buildings into solutions, “radically rethinking how buildings and cities are designed and constructed.”

More specifically, SOM said the design incorporates materials like bio-brick, hempcrete, timber and biocrete, which reduce the carbon impact of construction by 50% when compared to concrete and steel.

And while the idea may sound like a pipe dream, Yasemin Kologlu, a principal at SOM’s New York office, said, “the power of this idea is how achievable it is.”

“Our proposal brings together new design ideas with nature-based solutions, emerging and current carbon absorption technologies and integrates them in ways not done before in the built environment,” she added.

PanXchange commented that so-called nature-based solutions to capture CO2 emissions are rapidly becoming an investment theme. That concept gained additional credence from an announcement by the Department of Energy on November 8 that it would provide up to $45 million to support the development of technologies that can transform buildings “into net carbon storage structures.”

“Building materials and construction techniques offer huge promise as carbon sinks,” said Secretary of Energy Jennifer Granholm. 

Skidmore, Owings & Merrill photo.

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